Govt keen on private participation in airport development

LANGKAWI: The government is encouraging the private sector to invest in airport development and expansion throughout the country, Transport Minister Anthony Loke Siew Fook said.

He said these projects would be crucial for the country’s economy and tourism sector, and provide flexible returns for investors.

“Budget constraint is the biggest challenge for the government. However, we can’t wait until the government has the financial ability to embark on the airport development (expansion) throughout the country,” he said at a press conference after officiating the Airport Council International (ACI) Asia-Pacific (APAC) Small and Emerging Airports Seminar (SEAS) 2018, here, today.

Loke said the government is looking at new financing models, supported by private sector capital, particular from the Malaysia Airports Holdings Bhd (MAHB).

“Airport development will continue to flourish. We are studying with MAHB to revise the new operating agreement (OA),” he said, adding that MAHB’s interest will be retained as the airport operator as it has been managing airports in the country for the past 26 years.

Loke said the government also wants to ensure that investors will have sufficient returns for their investments.

“Without efficient airports, we can’t grow the country’s economy efficiently because airports have two functions — growing the tourism sector and air cargo,” he said.

Under the current OA, the government is tasked on airport development throughout the country. MAHB, meanwhile, manages the airports and pays a user fee of about 11.8 per cent (RM300-400 million) to the government annually.

“We want to make the airport operating environment more flexible in terms of tax arrangement, particularly the user fee imposed to MAHB.

“This includes the revision of Regulated Assets Base (RAB) model – where airport charges are regulated with fix rate dependent on how much investment has been put in airport development,” he said.

 

Source: NST